General Motors Co. (IW500/5) announced today that it would be partnering with LG Chem on a $2.3 billion joint venture to build a new battery assembly plant in the Lordstown, Ohio, area. The announcement said the factory would create more than 1,100 new jobs.
In the statement, GM CEO Mary Barra said, “Combining our manufacturing expertise with LG Chem’s leading battery-cell technology will help accelerate our pursuit of an all-electric future.”
GM says the JV includes an agreement with LG Chem to develop “advanced battery technologies” in order to reduce battery costs and remain flexible with regards to “ongoing advances in technology and materials.”
The statement also says the plant will have “an annual capacity of more than 30 gigawatt hours,” with room for expansion.
The press release does not specify wages, and a GM spokesman could not be reached for comment by press time. Earlier reports said wages at the plant would be about $17 an hour, considerably less than the roughly $30 an hour assembly workers with seniority made at the Lordstown GM plant shuttered earlier this year.
The partnership with LG Chem makes sense for GM, which purchased batteries for the Chevrolet Bolt from the South Korean supplier.
“Our joint venture with the No. 1 American automaker will further prepare us for the anticipated growth of the North American EV market, while giving us insights into the broader EV ecosystem,” said LG Chem CEO Hak-Cheol Shin in the statement. The deal will grant LG Chem access to an experienced workforce and a dedicated production stream of future GM electrical vehicles, the statement said.
GM has announced it will sell at least 20 fully electric models by 2023, including a battery-powered truck slated for the fall of 2021, and has ramped up investment in batteries and electrical vehicles as a result, including in its Warren, Michigan, battery lab.
In a separate statement, Ohio Governor Mark DeWine heralded the announcement as “great news.” DeWine was present with GM CEO Barry and LG CEO Shin for the deal’s signing ceremony in Warren, Michigan this morning.
Funding for the plant was included in GM’s October, 28 deal with the UAW. In that same deal, GM announced it would sell the Lordstown Assembly plant site to Lordstown Motors Corp., an electric truck-making startup owned by Workhorse Group. The UAW’s reservations about electrification are documented in a white paper published by the union, in which they estimate that the transition to electrical vehicles could eliminate 35,000 jobs at engine and transmission plants.
Groundbreaking on the new battery plant is expected to begin sometime in mid-2020.
